Financial desktops are becoming increasingly crowded as new cloud-enabled technology providers enter the space, and as banks and buy-side firms increasingly look to bring in new datasets and analytics tools. While fighting for space on the desktop has been an issue for decades now, it’s becoming more pronounced.
A new initiative being formed by some of the largest banks, asset managers and vendors in the capital markets is aiming to bring universal connectivity and standards to all of the financial industry’s desktop applications.
The Financial Desktop Connectivity and Collaboration Consortium (FDC3) is led by operating-system provider OpenFin and includes over 20 capital markets firms, including major banks and brokers like Barclays, JPMorgan, Morgan Stanley, RBC and TP Icap; asset managers such as AllianceBernstein and Citadel; and vendors including Algomi, ChartIQ, Cloud9, FactSet, Fidessa, GreenKey and OTAS Technologies.
Mazy Dar, CEO of OpenFin, tells WatersTechnology that the group wants to create the equivalent of the Financial Information eXchange (FIX) protocol for desktops, which would enable desktop applications to communicate with one another via a common protocol the same way that FIX created a common protocol for server-side communication between systems.
“Just like with a telephone wire, what language are you speaking over that wire? You need a common language for the apps to be able to communicate with one another on the desktop, and we’ve never had that before,” Dar says.
Getting Off the Ground
Traders, sales associates and portfolio managers have anywhere from 5 to 15 apps on their desktop that, for the most part, do not seamlessly communicate with each other. This can create breaks in workflow, errors, lost time and can prevent firms from trying out new tools or integrating new datasets.
Kim Prado, global head of client insight, banking and digital channels technology at RBC Capital Markets, tells WatersTechnology that the aim of FDC3 is to enhance productivity through desktop interoperability.
“The landscape is constantly changing and the application stack is continually changing,” she says. “The sheer number of vendors coming into play means we can’t possibly bring in, test and integrate all of their applications into our platform, and certainly not within the desired timeframe. OpenFin has changed this. Its interoperability feature creates an environment where more fintech companies coming on board creates a faster time to market and delivery to our users.”
FDC3 was established in October 2017 and members have been meeting about once every two weeks to get the project off the ground. Thus far the group has focused on three areas of development.
The first is the creation of a common language for sharing context and data between applications. So, if an equities trader is on their trading application and clicks on a ticker, that will invoke a market data or charting app to launch for that specific equity ticker. Before that can happen, you need to describe that equity ticker.
Second, they are building a protocol for one app to tell another app to start an activity. When a trading app tells a charting app to show the trading app a chart for a particular ticker, that “show-chart” instruction is referred to as an “intent.” So, the group has to codify the standardized intent that represents the various types of activities that would be shared in a workflow between applications.
And finally, FDC3 is defining a standard for app directories. “If you’re on a messaging application,” Dar says, “you want to trust the identity of the person on the other side and know who you’re talking to.” OpenFin has implemented the standard and is hosting an app directory that anybody can use free-of-charge, but they are also allowing any vendor to have their own app directory if they want to have their own app store, and any bank or buy-side firm can implement their own app directory and host those for internal applications, Dar says.
“Once everybody is using the same thing, then everybody can communicate. So if App A is an internal application at a bank, it can share context with any number of third-party applications. In the past, if a bank wanted to use 5 or 10 different applications, they would have to reach out to each vendor individually,” Dar says. “Now let’s say all the vendors are market data vendors, they’re essentially doing the same activity but it may be that each market data vendor provides a different protocol. So if you want to tell my market data app to show you a chart for an equity ticker, here’s how you do it. Now the bank has 10 different things that it needs to do, each a different bespoke integration, which means more time, more work, more room for error.”
Prado’s hope for this initiative is that a seamless app store environment is created so that the bank’s employees can pick and choose the apps they want to use.
“My hope is that it sticks. If more fintech companies work with OpenFin we can eventually reach an optimum point where OpenFin has an app store and companies like ours say, ‘What chat applications are wrapped in OpenFin? Ok, these five—let’s try that one,’ and download it,” she says. “If you think about your iPhone, you work off of apps. That’s the environment we’re moving towards where we can provide our sales force with an app store to pick and choose from. More vendors getting on board will create huge benefits.”
‘The Great Unbundling’
When you have one dominant vendor—think: the Bloomberg terminal—then you don’t have to worry about standards as much because it’s a contained environment. But if firms want to break away and try new tools geared toward their exact needs, then applications will need to be able to talk to one another, notes Dan Schleifer, CEO and co-founder of charting specialist ChartIQ.
“To make the great unbundling a reality you need standards for interoperability,” he says. “The tough part is that standards take a lot of time and buy-in to happen, and people want things they can use now. And once they do emerge, you then need implementations that adhere to the standards, which takes even longer. As a vendor, we want to make the future a reality now—offering interoperability and workflows in [the company’s UI/UX toolkit] Finsemble today—while also fully participating in standards development. So, we commit to our customers that if they build using Finsemble, we’ll support the standards under the hood when they do emerge.”
But as Prado noted, more fintech companies will have to get involved. In order for that to happen, though, more end users will have to show that they’re serious about this initiative, adds Dar.
“You need to have broad support behind the standard; you really need everybody to tell everybody else that, ‘Yes, we’re going to implement this.’ If the vendors know that the buy side and sell side are going to implement the standard, then they will, too; if the sell side knows that the buy side will implement it, then they will, too,” he says. “You need the right critical mass of people behind the standard.”
Anthony and James take a look at the interdealer broker space and quickly hit on whether or not bitcoin ETFs are to come in the near future.Subscribe to Weekly Wrap emails